Generally, the Relationship Between the Liquidity Premium and Term to Maturity

question 76

Multiple Choice

Generally, the relationship between the liquidity premium and term to maturity is

• A)inverse.
• B)direct.
• C)negative.
• D)None of the above

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Definitions:

Debt-equity Ratio

A measure representing the balanced usage of debt and shareholders' equity in funding company assets.

Profit Margin

A financial metric indicating the percentage of revenue that exceeds the cost of goods sold, showcasing efficiency in managing expenses versus income.

Growth Determinant

Factors that contribute to the economic expansion of a country, region, or industry, impacting productivity and development.

Cash Coverage Ratio

Cash coverage ratio is a financial metric that measures a company’s ability to pay its debt obligations with its operating cash flow.